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Hon Hai Precision Industry Co., widely known as Foxconn, is set to significantly increase its server capacity in response to soaring demand for Nvidia Corp. chips, which are crucial for artificial intelligence (AI) development. The company’s chairman, Young Liu, described the demand for the latest Blackwell chips as “crazy,” aligning with comments made by Nvidia’s Chief Executive Officer Jensen Huang regarding the growing AI investment landscape.
To capitalize on this opportunity, Hon Hai is constructing the world’s largest assembly plant dedicated to servers equipped with Nvidia’s cutting-edge Grace Blackwell chips in Mexico. Liu revealed that the facility aims for a planned capacity of 20,000 GB200 NVL 72 servers by 2025, marking a notable expansion of their operations.
“There was a lot of talk that the need for compute may be saturated pretty soon. But it looks like the demand is still growing. So that’s beyond our expectations,” Liu noted, highlighting the unexpectedly strong growth in AI-related computing needs.
Despite this optimistic outlook, Liu acknowledged a “hiccup” in the production timeline for the GB200 servers. He confirmed that there will be a delay in the availability of Blackwell chips, with shipments now projected to begin in late fourth quarter rather than in the earlier part of the October-December period.
Nonetheless, Nvidia’s Chief Financial Officer, Colette Kress, stated in August that the company anticipates shipping several billion dollars worth of Blackwell chips in its fiscal fourth quarter, indicating robust demand and ongoing investment in AI technologies.
As companies continue to invest heavily in AI, Hon Hai’s strategic expansion positions it well to meet the rising needs of this rapidly evolving market.
Sources By Agencies
